The pound to euro exchange rate has hovered around the 1.12 mark since the beginning of the week, making little positive progress as Brexit talks came to a close at the end of last week. Coupled with the economic fallout of the ongoing coronavirus (COVID-19) pandemic, and subsequent lockdown measures around the world, sterling has struggled to pull back strength.
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Moving forward in the week, no major political developments are scheduled which means it is likely more of the same.
The pound is currently trading at a rate of 1.1241 against the euro at the time of writing, according to Bloomberg.
This is a minor decrease compared with its rate at the same time yesterday, when GBP was sitting at the 1.125 mark.
Michael Brown, currency expert at Caxton FX, spoke to Express.co.uk to share his insight into the pound’s current standing.
He said: “Sterling slid steadily lower against the common currency over the course of yesterday, though kept its head above the 1.12 handle, amid rather risk-averse trading conditions.
“Today, with no notable releases due from either side of the Channel, rangebound conditions are likely to prevail.”
The world has been thrust into an unprecedented economic struggle due to lockdown measures.
In many countries, “stay at home” orders were implemented by governments, meaning many people were forced to stop working for some time.
Retail outlets, restaurants, and leisure facilities closed their doors, meanwhile, the travel industry was shut down, resulting in plummeting tourism figures.
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World Bank president David Malpass described the effects the pandemic has had on the global economy as “a devastating blow”.
However, many countries in the world are now beginning to reemerge from lockdown, with new social distancing measures in place.
Though travel may be a far-cry for Britons at the moment, making the need for holiday travel money all but obsolete, in some countries tourists are being welcomed back.
In Italy, holidaymakers can return, including Britons, but they must meet strict criteria in order to pass the border.
The Italian Tourist Board announced that from June 3, 2020, British visitors would be welcomed back to the country and would not face quarantine measures.
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Flavio Zappacosta, manager for UK and Ireland at the Italian Tourist Board, said the tourism industry is key to Italy’s economy.
“The tourism industry is one of Italy’s key economy drivers so it is with utmost importance that we open for business as soon as it is safe to do so,” he said.
Whether or not tourists face a mandatory quarantine will depend on where they are arriving from. All EU countries, and the UK, are exempt.
Similarly, Greece has announced plans to welcome back tourists but has insisted they take a COVID-19 test upon arrival.
Negative test results indicate a person must self-isolate for 7 days, meanwhile, positive results mean a person must self-isolate for 14 days.
Though this rule is currently in place for all arrivals, from June 15 it will only apply to certain people.
The FCO explains: “From 15 June onwards, mandatory testing and self-isolation/quarantine will remain in place for anyone arriving into Greece from an airport listed by the European Aviation Safety Agency (EASA).”
In the UK “high risk” airports which will be subject to these measures include Birmingham, Doncaster Sheffield, East Midlands, Gatwick, Glasgow, Heathrow, Leeds Bradford, Liverpool John Lennon, London City, Luton, Manchester Airport, Newcastle International, and Stansted.
How the exchange rate, will recover in the coming months as the world attempts to revive its economies is yet to be seen.
However, travel expert Jeremy Thomson Cook of Chief Economist at Equals (formerly known as FairFX) points out that this is not the only thing that could impact sterling’s standing.
He said: “Sterling remains spectacularly blasé to the risks of a no-deal Brexit which sits a mere few weeks away.”
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